Smith & Wesson Earnings Trigger Rush into Firearm Stocks

Smith & Wesson shares shot up 17% on Thursday, a day after the Tennessee-based firearms manufacturer reported earnings that would make Dirty Harry smile.

Investors, meanwhile, felt lucky and poured into related stocks, betting the outdoor, firearms and sports-shooting business is ready to dispense with a slow couple of years.

Taking Stock of a Gun Stock

Heading into the year, US gun sales were at ease, posting modest annual declines from 2023 to 2025. Roughly 14.6 million background checks for gun sales were performed in 2025, representing a 4.1% year-over-year decline, according to analysis of FBI data by the National Shooting Sports Foundation. This year, the market is at attention: Industry watchers hope a 3.2% year-over-year increase in the number of background checks (to 1.1 million) in May indicates a nascent turnaround.

Enter Smith & Wesson’s latest earnings. The company reported after the bell Wednesday that it made a $16.2 million profit in its latest quarter, nearly double earnings a year earlier. Revenue rose 27% to $178.4 million, with 80% of sales growth coming from handguns and 37.5% of total sales coming from newly released guns. The top and bottom line figures blew past Wall Street expectations, some would say faster than 1940s cartoon Superman, who was faster than a … well, you know what. Smith & Wesson also shed a considerable amount of debt, ending its latest fiscal year owing $20 million, down from $80 million a year earlier. Executives said Smith & Wesson’s results signal that it’s outperforming the industry:

• CEO Mark Smith (no relation to 19th-century gunsmith and company cofounder Horace Smith) said background checks reported by the FBI fell 2.3% in the fiscal year through April, while Smith & Wesson’s shipments rose 14.7%, suggesting it won market share.
• Nevertheless, investors viewed the result as an upbeat indicator for the broader gun, outdoor and shooting-sports industry. Shares in rival firearm manufacturer Sturm, Ruger & Co. rose 5.7% on Thursday, while online firearms marketplace Outdoor Holding Co. and retailers American Outdoor Brands and Sportsman’s Warehouse also posted gains.

State of Affairs: Gun sales are likely getting a boost from state policies, too, one of which is on the verge of an about-face. Virginia businesses have reported surging gun sales in advance of a July 1 state ban on assault rifles: State police said background check applications for gun sales more than doubled last month to 72,956 from 35,571 in May 2025.